Monday, May 05, 2014Last Update: 7:45 AM PT

Change to Benefits Plan Is a Supreme Court Issue

WASHINGTON (CN) - Retirees who blocked a requirement to make health care contributions must defend their action in the Supreme Court, the justices said Monday. Hobert Freel Tackett led the class action in Columbus, Ohio, against M&G Polymers USA and associated health plans after M&G announced in December 2006 that its retirees would need to start making health care contributions. After a bench trial, a federal judge said the retirees should get health care for life without contributions and ordered them reinstated to the post-2007 benefits plans. Both parties appealed, with the retirees complaining that their pre-2007 plans should be reinstated, but the 6th Circuit affirmed the permanent injunction this past August. "Given the inapplicability of the capping agreements, the district court did not clearly err in finding that pre-August 9, 2005 retirees had a vested right to receive contribution-free health care benefits," the decision states. The Supreme Court granted M&G a writ of certiorari Monday, noting that it would answer only one of two questions presented. The question asks: "Whether, when construing collective bargaining agreements in Labor Management Relations Act (LMRA) cases, courts should presume that silence concerning the duration of retiree health-care benefits means the parties intended those benefits to vest (and therefore continue indefinitely), as the Sixth Circuit holds; or should require a clear statement that health-care benefits are intended to survive the termination of the collective bargaining agreement, as the Third Circuit holds; or should require at least some language in the agreement that can reasonably support an interpretation that health-care benefits should continue indefinitely, as the Second and Seventh Circuits hold." (Parentheses in original.) Per its custom, the court did not otherwise comment on the case.